Aztec Initial Phase: Purchase interests in proven, producing wells with underexploited drill sites. Aztec's business model truly sets it apart and should significantly benefit the company, its shareholders and outside investors. For outside investors, it is a way to gain access to low-risk, 'in-field' drilling opportunities, normally not available to 'outsiders'. For Aztec, it is a way to participate in drilling, at minor or no risk, plus to drill many more wells than it could afford to drill solely on its own. This makes Aztec's business model a true attractive win-win situation! The Conventional Ways Traditional oil exploration involves acquisition of exploration/drilling rights to properties, conducting seismic and other subsurface studies to determine if oil & gas is present and then drilling of the prospects in order to discover and extract the oil & gas. The process can be extremely expensive and time consuming. Additionally, there are no guarantees that an oil company will ever make a profit. Costs for drilling a single well can run into the hundreds of thousands (or millions) of dollars and a very high percentage of all traditional exploration wells drilled each year end up being dry holes. Aztec's Advantage Aztec believes that its method of investing in oil & gas properties, which have proven reserves plus undrilled well sites, and which are already producing oil, gives it a major advantage over many of its competitors. Another major advantage for Aztec is that, at its option, the company will likely not have to invest any of its own financial resources toward the drilling of wells on the properties in which it holds interests. Instead, the costs of drilling wells will be borne by outside investors that will then earn a part of the revenues derived from the wells which they finance. Investor Share In these scenarios, the investor(s) will receive a certain high percentage of the revenues from 'their' wells until initial costs are recovered, with the remaining percentage going to Aztec and other lease interest holders. Once the initial costs are paid back to the investors, subsequent revenues will be split on a 50-50, or other agreed upon basis. This allows Aztec to essentially eliminate many of the financial risks involved in drilling new wells, while receiving income from present field production as well as income from any new successful drilling. Future Arrangements for Initial Phase In the future, Aztec may also elect to invest its own capital resources into development drilling and, therefore, retain a larger percentage of the revenue stream. |